Recap 3-26-13


Keep an eye on EU bank CDS next week. It’s now sitting at the highest level since November. Only time will tell if peripheral retail depositors react to the Cyprus events, but in the meantime, a further widening in bank credit spreads has the potential to be a reflexive event.

Interesting bit from the NY Fed on House Price index revisions:


  • US Durable Goods were strong, driven by aircraft. However, the core metric, net of defense and aircraft, declined -2.7% in Feb vs -1.1% exp and +6.3% prev
  • Consumer Confidence declined to 59.7 in March vs 67.5 exp and 69.6 prev
  • New Home Sales declined to 411k in Feb vs 420k exp and 437k prev
  • Yesterday Dudley said Fiscal policy has turned significantly more restrictive and it’s the most important reason that the US economy isn’t growing more rapidly. He also said that a substantial improvement in the labor market would warrant a reduction in QE.
  • The BOJ’s Kuroda said he will consider all possible measures to lower the yield curve, including extending bond maturities. Kuroda also said there may be capacity to expand purchases of riskier assets. The BOJ would take whatever actions necessary to achieve a 2% inflation goal but Kuroda reiterated that monetary policy alone can’t cure Japan’s ills. Reuters

Upcoming Data:

  • Wed: UK GDP, EU Consumer Confidence, Canada CPI, US Pending Home Sales
  • Thu: Month End, German Retail Sales, Unemployment, EU Money Supply, Canada GDP, US Jobless Claims, Chicago PMI, USDA Ags Data
  • Fri: Good Friday, US Personal Spending, Core PCE, UMichigan Confidence
  • Mon: South Korea HSBC Mfg PMI, China Mfg PMI, US Mfg PMI, RBA